In a landmark move signaling progress in Nigeria’s efforts to rejuvenate its economic framework, President Bola Tinubu has commended the Nigeria Governors' Forum (NGF) for their unanimous support of four Tax Reform Bills currently under consideration by the National Assembly. This endorsement is poised to accelerate the administration’s ambitious tax overhaul agenda and bolster economic growth in the country.
A Unified Front
On Thursday, January 17, 2025, the NGF convened with the Presidential Committee on Tax and Fiscal Policy. The meeting culminated in a consensus that transcended regional, ethnic, and political divides, highlighting the governors’ collective resolve to drive transformative economic policies. Their backing of the Tax Reform Bills underscores a commitment to reinvigorating Nigeria’s investment climate and addressing long-standing structural inefficiencies in the tax system.
Key Components of the Endorsement
The NGF’s endorsement includes significant proposals designed to recalibrate Nigeria’s tax landscape:
Derivation-Based VAT Model: The governors supported a contentious shift to a derivation-based Value Added Tax (VAT) model, which promises a more equitable distribution of resources.
Proposed VAT Sharing Formula: The NGF recommended a VAT sharing formula of 50% based on equality, 30% on derivation, and 20% on population. This differs from the federal government’s initial proposal and reflects a nuanced approach to balancing equity and efficiency.
Productive Consultations: The endorsement followed extensive and productive discussions between the NGF and the Presidential Committee, signaling a collaborative effort to address lingering disagreements.
President Tinubu’s Reaction
In a statement issued by his spokesperson, Bayo Onanuga, President Tinubu lauded the NGF for their “bold leadership” and unwavering dedication to national unity. He praised the outcome of the consultations as a “model of effective cooperation” between the Federal and State governments.
President Tinubu emphasized that these reforms aim to:
Prioritize the welfare of Nigeria’s poorest citizens;
Advance national interests;
Enhance the competitiveness of Nigeria’s economy; and
Attract both local and international investments.
The President argued that modernizing the nation’s outdated tax laws is a critical step toward achieving these objectives and positioning Nigeria as a global economic contender.
Special Recognitions
The President extended special commendations to key players who have contributed to the progress of the reform agenda:
Governor Abdulrahman AbdulRazaq, Chairman of the NGF and Kwara State Governor, was lauded for his effective leadership in securing support among his peers.
The Progressive Governors Forum and the Northern Governors Forum were acknowledged for their roles in addressing contentious aspects of the bills and fostering unity.
A Call for Further Action
President Tinubu urged other stakeholders with innovative ideas and constructive suggestions to engage with the legislative process at the National Assembly. He called on lawmakers to expedite the passage of these critical bills, emphasizing the urgency of translating consensus into tangible reforms that would deliver immediate benefits.
A Transformative Milestone
The unanimous endorsement by the NGF is a significant milestone in President Tinubu’s broader economic reform agenda. It represents a rare moment of bipartisan cooperation and reflects a shared vision for a prosperous Nigeria. As the Tax Reform Bills advance through the legislative process, attention now turns to the National Assembly, where swift action is anticipated to solidify this landmark achievement.
This pivotal development is a testament to the power of collaboration between federal and state entities, setting the stage for a more robust and inclusive economic future for Nigeria.
0 Comments